Bitcoin Forum

I am accepting user defined quantities of bitcoins as payment, so the Mt. Gox merchant solutions will not work as far as I can tell. However, in the interest of my low profit margins, I need a way to limit market exposure when a user sends payment. The only way I can see to do this is by automatically creating a sell order at current market value as soon as bitcoins are received by my account at Mt. Gox or by having an open sell order at current market value waiting for coins to fund the order. I am getting low quality information from Mt. Gox, and it seems they don't offer such a feature through their current API.

This is very important to the success of my business being able to accept bitcoins. Please help!!! Thanks in advance.

Huh? Can't you simply offer to sell them for $0.01 each so that you willl instantly sell them at any price that low or higher, automatically getting the highest price available? Isnt that how market orders work?

That is, offer to sell a billion bitcoins at $0.01 each so any bitcoins you do have will get sold as fast as they arrive in your account?

-MarkM-

Do market orders that low automatically fill at the highest available price? If so, then that would seem a feasible solution.

yes. any limit (that is a limit order not market order) order of any price will always execute at the highest possible price available.

A limit order of 100 BTC @ $X doesn't mean "sell 100 BTC @ $x" it means "sell 100 BTC but don't accept a price BELOW $X".

Awesome, thanks for saving me from overcomplicating a simple solution!! I love this community.

Please note that the actual price that you get is a matter of exchange policy, not a law of mathematics.  Do not set X below the least amount that you are willing to accept for them.  If you tell the exchange: "sell 100 BTC for not less than $0.01 each", you can't get upset if your sale only nets you $1.00, even if it usually gets you over a grand.

So, there's no guarantee that Mt. Gox will actually match your order with the highest price? In your opinion, would this be a bad method for insuring my coins will get sold at market price? I understand the mathematical aspect of it, but in it's real world application is it really risky?

It's not more risky than making a market order at any other point of time. The actual "risk" is marginal and is governed by the chance that there is a selloff right before your coins arrive at mtgox.

Chances that prices crash to 0.01 in the near future are very slim, if you are concerned about that you shouldn't be dealing in BTC... For all practical purposes the event triggering that would have to be a serious uncorrectable flaw in the encryption in which case you coins wouldn't be safe anyway. Any other scenarios like all bitcoin hoarders deciding to cash out at the exactly same time are close to ridiculous.

I would speak to them.

They have dealt with this issue, I presume, several times over the years,

But a statement from them will necessarily be more useful than any third-hand quotes that you collect from these forums.

Inquiry to Mt Gox:



Ok great, so for example, if I create an open sell order for 20,000 BTC at $1.00, will the coins always sell at current market value? Or is there a risk they could sell sharply below current market value?


 October 26, 2012 14:15
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Danny

Support Desk
 

Hello Steven,

Thank you for the email. If you choose the market order on the trade menu, the transaction will be processed as per the current market value. However if you uncheck the market order option and provide the exact amount the BTC has to be sold, it will be processed accordingly.

Thanks,

MtGox.com Team



This was not much help, so I'm just going to go ahead and assume they always match open sell orders with the highest open buy order.... if this is a poor assumption, please advise. Thanks guys.

This assumption have costed me $1,000 when my order got executed at a pretty low amount.

Even if Gox assured it would execute at highest possible price, be careful. And do not assume it from any other exchange, it just depends on how their engine is coded.

Yikes... so they filled your order below market value and it cost you $1,000? If that's true then it looks like I'm back at square one...

It wasn't Gox, it was another smaller exchange.

A good idea would be to test that with a small amount first.
Then you see if it sells at current market price  ;D

You could use a small bot, that just requests the current gox depth before posting the order?